ACA helps fatten for-profit hospitals' bottom lines

The Affordable Care Act--and hospital-based programs intended to enroll patients in newly available health insurance plans--have been a boon to bottom lines of publicly traded hospital chains, Forbes reported.

Dallas-based Tenet Healthcare Corp. has been one of the biggest recipients of this largesse, reporting its biggest pre-tax earnings in a decade. The company has been particularly aggressive through its "Path to Health" program that enrolls individual patients in insurance plans who are eligible for ACA-related coverage.

"We held nearly 800 outreach and enrollment events, reaching tens of thousands of people in our priority markets," Tenet Chief Executive Officer Trevor Fetter told Forbes. "Our daily enrollments have increased by more than 60 percent during this enrollment period, and we estimate that we will exceed the number of exchange enrollments that we achieved last year."

This dovetails with overall drops in uncompensated care. The U.S. Department of Health and Human Services reported last year that the ACA would reduce uncompensated care costs by $5.7 billion, particularly in those states that chose to expand Medicaid eligibility.

 "For the last four quarters, the decline in self-pay admits and adjusted admits and the increase in Medicaid in expansion states have grown quarter over quarter," Community Health Chief Financial Officer Larry Cash told Forbes.

HCA, another large hospital chain, reported a 9 percent drop in self-pay and charity care patients during the fourth quarter of 2014.

Despite the rosy numbers, Healthcare Dive has reported that the outlook is not as optimistic for not-for-profit hospitals due in part to rising costs and weaker reimbursement.

Forbes suggested that a better economic outlook may also be working in the favor of hospitals.

"ACA enrollments bore a lot of fruit for hospitals last year as previously uninsured patients sought healthcare, but year 2 is a different ball game," Fitch Ratings' Senior Director of Healthcare Megan Neuburger told the magazine. "We can't discount other factors like greater disposable income as the economy improves or seasonal issues like the flu."

To learn more:
- read the Forbes article 
- check out the Healthcare Dive article

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